XML 41 R30.htm IDEA: XBRL DOCUMENT

Subsequent Events

9 Months Ended

Sep. 30, 2021

23. SUBSEQUENT EVENTS

Follow-on Offering—In October 2021, the Company completed a follow-on offering of common stock, in which it sold 2,500,000 shares at a public offering price of $62.00 per share less underwriting discounts. In addition, the Company granted the underwriters a 30-day option to purchase up to an additional 375,000 shares of common stock on the same terms and conditions (the “Option”). On October 5, 2021, the underwriters exercised the Option in full. Net proceeds to the Company from the follow-on offering, including the Option, were approximately $169.8 million.

Business Acquisitions—On October 1, 2021, the Company completed the business acquisition of Environmental Chemistry, Inc. (“ECI”) by acquiring 100.0% of its common stock. ECI provides a full suite of environmental laboratory analytical services to industrial, governmental, and engineering/consulting clients. Combined with the Company’s existing Houston, TX laboratory, ECI (located also in Houston, TX) will enable Montrose to provide air, water and soil analytical services in the gulf coast region.

On November 1, 2021, the Company completed the business acquisition of Horizon Water and Environment, LLC (“Horizon”) by acquiring 100.0% of its membership interests. Horizon is an environmental consulting firm specializing in planning, watershed science, and environmental compliance for water and natural resource projects in California. Horizon will join Montrose’s Planning & Ecosystem Consulting segment.

These transactions qualified as an acquisition of a business and will be accounted for as a business combination. The following table summarizes the elements of the purchase price of these acquisitions:

					Other Purchase		Total
	Cash⁽¹⁾		Common Stock ⁽²⁾		Price Component ⁽³⁾		Purchase Price
ECI	$	4,000		—		—	$	4,000
Horizon		10,580		2,300		—		12,880

(1)

The cash portion of these acquisitions’ purchase price was funded through cash on hand.

(2)

The common stock component of Horizon was paid through the issuance of 34,921 shares of common stock.

(3)

The other purchase price components for ECI consist of a potential working capital target payment and a potential earnout amount, which are not finalized at this time. The other purchase price component of Horizon consists of a potential working capital target payment, which is not finalized at this time.

The Company has not yet completed the initial purchase price allocation for these acquisitions, including obtaining all of the information required for the valuation of the acquired intangible assets, goodwill, assets and liabilities assumed, due to the timing of the close of the transaction.